NJ paying up to $20m a year to NBC to use Meadowlands Arena as a soundstage

New Jersey’s now-shuttered Meadowlands Arena, which died at age 33 in 2015 of arena glut, has found new life as the soundstage for NBC Universal TV shows “The Enemy Within” and “Lincoln Rhyme: Hunt for the Bone Collector.” (They’ve never heard of you, either.) That’s a good adaptive, reuse of a state asset that doesn’t cost state taxpayers anything … except that in order to lure the productions, New Jersey Gov. Phil Murphy is paying them a whole lot of money in tax subsidies:

The relationship between NBC and the New Jersey Sports and Exposition Authority, which owns the arena, is the byproduct of a tax credit signed by Governor Phil Murphy that took affect last year and was meant to draw business to the state from film and digital media companies…

NBC reached out to the commission when it began scouting for warehouses to use as a sound stage. The commission suggested the abandoned arena and within weeks, NBC and the NJSEA struck a deal.

The NJ.com article on this doesn’t bother to calculate how much this is costing New Jersey taxpayers, so we’ll have to do the math for them. NBC spent $63 million filming the first season, and the Garden State Film and Digital Media Jobs Act reimburses 30% of a production company’s expenses — not 30% of its taxes, 30% of its expenses, even if that’s more than the company paid in local taxes (this is known as a “refundable” tax credit). So that means that if all of that $63 million was spent locally, New Jerseyans are paying more than $20 million for the privilege of being in close proximity to Russell Hornsby playing a tetraplegic “brilliant but hardheaded forensic criminologist.”

There are benefits to the local economy, certainly, since TV shoots hire local caterers, buy from local vendors, etc.; but numerous studies have shown that these aren’t enough to repay states’ expense on subsidies, which is why lots of states, including New Jersey, have canceled them in the past. (Though former New Jersey Gov. Chris Christie seems to have been motivated less by the program’s terrible economics than by his concern that “Jersey Shore” made the state look bad.) NBC Universal’s current lease is $185,000 per month, and the state sales and income taxes are in the single digits, so it seems inconceivable that New Jersey is getting anywhere near positive bang for its buck.

The NJ.com article, meanwhile, happily burbles along without wondering about any of this, but it does take the time to include this memorable quote from Jim Kirkos, president of the Meadowlands Regional Chamber of Commerce, about how tough it was when the arena closed:

“It was a blow not only to the union workers and stage hands, but we lost the economic impact of event day activity,” he said. “The family of four who take their two kids to Disney on Ice is likely to go out to dinner to a local restaurant. It’s the sports bars, if it’s a sporting event. All the restaurant and hospitality-type businesses lost the positive impact of event activity.”

For those of you who’ve never been fortunate enough to attend a sporting event at the Meadowlands, let me paint a picture for you: It’s in the middle of a parking lot, in the middle of a swamp. I have been to dozens of sporting events and concerts (this was a particular highlight) there, arriving variously by car, train, and bus, and never once have I even been aware of a place that I could have dinner in the vicinity. The already dismal bump to local spending from sports facilities has to be at its absolute weakest in a place like the Meadowlands, to the point where I’m impressed that Kirkos could make the above statement without bursting into laughter.

It’s all just another lesson in a couple of things: One, that sports venues are the tax gift that keeps on costing, as elected officials tend to see them as “too big to fail” in ways that often end up throwing good money after bad; and two, that elected officials will sign ginormous checks for just about anything, so long as it can be declared a “tax credit” and for promoting “development.” The main difference between the rich and the poor, it turns out, is that the former’s grifting is less likely to be punished by bloodshed.

Share this post:

NJ getting $2m from Devils to close Meadowlands arena, Devils getting everything else

As it turns out, the operators of Newark’s Prudential Center are indeed paying to have the Izod Center in the New Jersey Meadowlands close for two years: The owners of the New Jersey Devils will pay the state of New Jersey a whopping $2 million to shut their competition down, in addition to freeing the state from the responsibility of a projected $8.5 million in red ink for each of the next two seasons.

And for their money, the Devils owners are also getting the right to restrict how the Izod Center is used once it reopens, if it reopens, in 2017:

In the letter [from the New Jersey Sports and Exposition Authority], the sports authority agreed either to keep the Izod Center closed in 2017 and in 2018 as well, or alternatively to reopen in 2017 in a format that is not directly competitive with the Newark arena.

In the latter case, the sports authority would agree that from 2017-2021, the Meadowlands facility would only offer a “single theatrical residency production” — a series of performances such as Cirque du Soleil — or cut the capacity of the Izod Center in half, to a maximum of 10,000 seats. Popular family shows such as the traditional traveling circus and ice-skating events that are featured in most or all arenas in the region also would not be held at Izod Center at that time, with an exception for shows produced by a new operator.

The Prudential Center will also produce and get all revenue from the run of the Ringling Bros. circus in March that’s scheduled to be the last events at Izod before its closure. All in all, it seems like a pretty sweet deal for the Devils owners, but given that all New Jersey had was a mostly empty arena, a sea of red ink, and a governor who has wanted the place closed for a while, it’s not like the state had much leverage.

Some Jersey lawmakers have objected to the deal, with State Sen. Loretta Weinberg charging that this is just a ploy to help out Gov. Chris Christie’s pal Jerry Jones — owner of both the Dallas Cowboys and part of Legends Entertainment, which runs concessions at the Prudential Center — and threatening to sue to stop it. Presumably once the center is actually closed, this kerfuffle will die down and … oh, who am I kidding, Chris Christie is involved, this controversy will go on and on forever! Especially if Christie can’t keep a handle on his itchy texting fingers.

Share this post:

Meadowlands arena to close for two years, re-emerge as beautiful butterfly

The Izod Center, the New Jersey arena formerly home to the Nets and Devils and more recently home to not a whole hell of a lot, could be shuttered after March in a plan to be voted on today by the New Jersey Sports and Exposition Authority. According to NJ.com, the deal includes granting Newark’s Prudential Center the rights to host future events scheduled for the Meadowlands arena, but it’s not clear whether the operators of the Newark arena would be paying anything to make their competitor go away or just having it dropped in their lap.

The ultimate goal here, or at least the rationalization, appears to be two-fold: New Jersey Gov. Chris Christie wants to stop paying for losses at the arena that were projected for $8.5 million this year; and to clear the way for the area around the arena site to be used for staging construction of American Dream, the mall-and-amusement-park project being planned after Xanadu, an amusement-park-and-mall project, went bankrupt as part of the Lehman Brothers collapse in 2009.

Everyone involved is saying the closure would only last through 2017, and the arena could then be reused for something else — though presumably not as an arena, since the New York City metro area is already facing a glut of those. It’s in a terrible location for transit, and the East Coast isn’t real big on megachurches or Bass Pro shops, so … super-Ikea? World’s largest Apple Store? If you have an idea, contact the New Jersey Sports and Exposition Authority — after today they won’t have much to do the next couple of years except take your calls.

Share this post: